City of Belmont, Mississippi v. Mississippi State Tax Commission

IN THE SUPREME COURT OF MISSISSIPPI

NO. 2001-CA-00729-SCT

CITY OF BELMONT, CITY OF CALHOUN CITY,
CITY OF CANTON, CITY OF CORINTH, CITY OF
GREENVILLE, CITY OF GRENADA, CITY OF
GULFPORT, CITY OF HOUSTON, CITY OF
INDIANOLA, CITY OF JACKSON, CITY OF
KOSCIUSKO, CITY OF NEWTON, CITY OF OCEAN
SPRINGS, CITY OF PEARL, AND CITY OF
WAYNESBORO

v.

MISSISSIPPI STATE TAX COMMISSION AND
EDWARD H. BUELOW, JR., CHAIRMAN

DATE OF JUDGMENT: 04/06/2001
TRIAL JUDGE: HON. W. SWAN YERGER
COURT FROM WHICH APPEALED: HINDS COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANTS: JAMES RAY MOZINGO
JAMES A. PEDEN
ATTORNEYS FOR APPELLEES: SAMUEL D. HABEEB
GARY WOOD STRINGER
NATURE OF THE CASE: CIVIL - OTHER
DISPOSITION: AFFIRMED - 03/27/2003
MOTION FOR REHEARING FILED:
MANDATE ISSUED:

EN BANC.

CARLSON, JUSTICE, FOR THE COURT:

¶1. Several municipalities sued the Mississippi State Tax Commission and its chairman

("MSTC") seeking declaratory and injunctive relief to require the MSTC to comply with
state law in its diversion of state sales tax funds to the municipalities.1 On a Rule 12 (b)(6)

motion to dismiss2 filed by the MSTC, the circuit court dismissed this suit pursuant to Miss.

Code Ann. §§ 11-46-9(1)(b), (d) & (i), Miss. Code Ann. §§ 27-65-75 and 27-3-57, and

House Bill 987, 2000 Miss. Laws ch. 304 (H.B. 987). Some of these municipalities appeal

the ruling of the circuit court citing numerous errors. Finding the MSTC's motion to dismiss

was properly granted, this Court affirms the judgment of the circuit court.

FACTS AND PROCEEDINGS IN THE TRIAL COURT

¶2. In 1968 the Legislature repealed the City Sales Tax Law, which had allowed

Mississippi municipalities to levy and collect their own sales taxes, and replaced this source

of revenue by disbursing to the municipalities a portion of the state sales tax pursuant to

Miss. Code Ann. § 27-65-75. The MSTC is the department of state government charged

with properly and accurately reporting to the State Treasurer and the State Auditor the

amount of sales tax diversions due each municipality each month. Miss. Code Ann. § 27-3-1

et seq. (1999) and § 27-65-1 et seq. Pursuant to § 27-65-75(1), on the fifteenth day of each

month, eighteen and one-half percent (18½ %) of the total sales tax revenue collected during

the proceeding month on "business activities within a municipal corporation shall be

allocated for distribution to such municipality and paid to each municipality." There are

certain types of sales tax revenues which the MSTC is not required to divert to

municipalities. See Miss. Code Ann. §§ 27-65-15, 27-65-19(3), 27-65-21 & 27-65-75.

1
Though these several municipalities have repeatedly asserted that this litigation is not about
monetary damages, as will be herein revealed, it really is.
2
Miss. R. Civ. P. 12 (b)(6).

2
¶3. According to Miss. Code Ann. § 27-3-57, it is the duty of the MSTC to determine the

amount of funds owed to each municipality, while it is the duty of the State Treasurer to

disburse the funds to the municipalities.

¶4. At no time since the inception of municipal sales tax diversions in 1968 has the

MSTC made a determination that sales tax disbursements should be made to the

municipalities on sales taxes collected from direct pay permit holders,3 penalties and

interests collected on sales taxes and sales taxes collected from out-of-state businesses

having Mississippi locations, i.e., "083 Accounts."

¶5. On November 16, 1999, the Cities of Amory, Belmont, Booneville, Calhoun City,

Canton, Corinth, Greenville, Grenada, Gulfport, Houston, Indianola, Jackson, Kosciusko,

Newton, Ocean Springs, Pearl, Pontotoc, Ridgeland, Starkville and Waynesboro, each a

Mississippi municipal corporation (hereinafter collectively the "Municipalities"), filed a

complaint against the Mississippi State Tax Commission and Edward H. Buelow, Jr., in his

official capacity as Chairman of the MSTC, seeking declaratory and injunctive relief to

require the MSTC and its Chairman to comply with state law concerning the diversion of

state sales tax to the Municipalities.4 On December 16, 1999, the MSTC filed a motion to

dismiss stating that: (1) the Municipalities were barred from filing the suit by the doctrine

of sovereign immunity and the Mississippi Tort Claims Act; (2) the Municipalities were

3
A direct pay permit holder is a purchaser who is responsible for reporting and remitting the sales
tax directly to the State in lieu of payment of the tax to the vendor, thereby relieving the vendor of any
liability.
4
The cities of Amory, Booneville, Pontotoc, Ridgeland, and Starkville are not parties on appeal to
this Court.

3
preempted from filing the suit because the right of such action was only granted to the state

auditor; and, (3) the Municipalities failed to state a claim upon which relief could be granted.

The MSTC’s main basis for these assertions was that the State Treasurer, not the MSTC,

was the party responsible for disbursing the funds. On February 2, 2000, the Municipalities

amended their first complaint to restate their demand for permanent relief to include that the

MSTC be directed to perform all acts as required under Miss. Code Ann. § 27-65-1 et seq.

(2000) and § 27-3-57 (1999), and on February 16, 2000, the MSTC filed a motion to dismiss

the amended complaint.

¶6. On March 7, 2000, the Legislature passed House Bill 987 which was signed by the

Governor on the same day. 2000 Miss. Laws ch. 304. House Bill 987 states:

SECTION 1. The method employed by the State Tax Commission to calculate
all payments made to municipalities under the provisions of Section 27-65-75,
Mississippi Code of 1972, prior to the effective date of this act, is hereby
ratified, approved and confirmed as being the proper method of calculating
payments due to all municipalities under the provisions of Section 27-65-75,
Mississippi Code of 1972, for all periods prior to the effective date of this act.

SECTION 2. From and after the effective date of this act, the method of
computing payments due to municipalities under the provisions of Section
27-65-75, Mississippi Code of 1972, shall be the same as that utilized by the
State Tax Commission prior to the effective date of this act unless the method
is changed by legislative act.

SECTION 3. Any suit brought by a municipality to recover additional
payments under Section 27-65-75, Mississippi Code of 1972, in excess of the
amounts authorized in this act is hereby abated.

SECTION 4. This act shall take effect and be in force from and after its
passage.5

5
2000 Miss. Laws ch. 304, was never codified as part of the official Mississippi Code.

4
¶7. On April 13, 2000, the MSTC amended its motion to dismiss to include the

provisions of H.B. 987 as an additional basis for dismissal. A hearing was held on May 22,

2000, and on November 14, 2000, the trial judge issued a three-page memorandum wherein

he stated, inter alia, that he was granting the MSTC’s motion to dismiss. Although the trial

judge's memorandum stated only that the Municipalities did not have standing to sue and

that H.B. 987 required dismissal, the judge in essence adopted the MSTC's proposed opinion

which contained rulings on thirteen separate defenses.6

¶8. By way of this decision, the trial judge granted the MSTC's motion to dismiss finding,

that as creatures of the state, the Municipalities lacked standing to bring suit; the

Municipalities were barred from bringing suit by the Mississippi Tort Claims Act, see Miss.

Code Ann. §§ 11-46-9(1)(b), (d) & (i) (Rev. 2002); the Municipalities had no authority to

bring suit because exclusive authority was vested with the State Auditor, see Miss. Code

Ann. §§ 27-65-75 & 27-3-57; the Municipalities failed to state a claim upon which relief

could be granted because the State Treasurer, who is in charge of disbursing funds, was the

6
The trial judge’s 3-page memorandum contained the following language:

The attorneys for the State Tax Commission may submit to the Court, for its consideration,
a proposed opinion/order consistent with these rulings of the Court and with the briefs and
arguments contained therein of the State Tax Commission.

The MSTC asserts that this language in the trial judge’s memorandum, coupled with the trial judge’s
additional memorandum language that he had “spent considerable time” studying the parties’ briefs, reveals
that the trial judge had agreed with the MSTC’s position and thus directed that the proposed opinion/order
should be drafted consistent with his rulings and MSTC’s “briefs and arguments.” On the other hand, the
Municipalities assert that the trial court’s “virtually verbatim adoption” of the proposed opinion submitted
by the MSTC subjects the trial court’s opinion to “heightened scrutiny” by this Court. In re Estate of
Grubbs, 753 So.2d 1043, 1046-47 (Miss. 2000).

5
proper party to this suit, see Miss. Code Ann. § 27-3-57; and by passage of House Bill 987,

the Municipalities’ suit was abated, see 2000 Miss. Laws ch. 304.

¶9. After this January 5, 2001, ruling of the trial judge, the Municipalities, on January 16,

2001, filed a motion to alter or amend the judgment challenging alleged unsupported factual

findings and erroneous legal conclusions based thereon; however, the motion to amend was

denied. The judge did amend the original judgment to dismiss the complaint with prejudice

to hold that the State Auditor would not be precluded from bringing suit on the same subject

matter. The Municipalities timely filed their appeal before this Court and raise the following

seventeen issues:

1. Whether the circuit court erred in granting the MSTC's Motion to Dismiss.
2. Whether the circuit court's granting of the MSTC's Motion to Dismiss is
contrary to the applicable law in this case.
3. Whether the circuit erred by basing its decision to grant the MSTC's Motion
to Dismiss on findings of fact and on mixed findings of law and fact which
are not supported by the record and which are contrary to the record.
4. Whether the circuit court erred in dismissing the Amended Complaint with
prejudice.
5.Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that the Municipalities lacked the standing to bring
the claims set forth in the Amended Complaint.
6. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that the relief requested was not authorized by law.
7. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that the Amended Complaint was a suit for money
damages against the State of Mississippi and was thus barred.
8. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the basis of House Bill 987 passed by the 2000 Mississippi
Legislature.
9. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint with prejudice, thereby denying the Municipalities any recourse or
redress in the Courts of the State of Mississippi for open and ongoing
violations of State law by the Tax Commission of which State law the
Municipalities are direct and primary beneficiaries.

6
 10. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground it is barred by statutory and common law sovereign
immunity.
11. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that the State Auditor has the sole and exclusive
authority to challenge determinations of the Tax Commission.
12. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint with prejudice on the ground that it failed to state a claim against
the Tax Commission as opposed to the State Auditor.
13. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that it is preempted and barred by the statutory
scheme of sales tax diversions, as is more fully set forth in Paragraph 33 of the
circuit court's Opinion and Judgment.
14. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground that the Mississippi Legislature has plenary power
over all aspects of the government of the State of Mississippi.
15. Whether the circuit erred in determining the Municipalities had no
standing to challenge the constitutionality of House Bill 987.
16. Whether the circuit court erred in determining that House Bill 987 does
not violate the separation of powers prescribed by the Mississippi
Constitution, and in determining that the Mississippi Legislature has "absolute
authority" over the issues and claims contained in the Amended Complaint.
17. Whether the circuit court erred in dismissing the Municipalities' Amended
Complaint on the ground of the abatement provision of House Bill 987.

For sake of clarity, the issues identified by the Municipalities have been consolidated into

two issues for purposes of this opinion:

I. WHETHER THE TRIAL COURT ERRED IN HOLDING THE
MUNICIPALITIES DID NOT HAVE STANDING TO FILE
SUIT AGAINST THE MSTC.

II. WHETHER THE TRIAL COURT ERRED IN HOLDING THE
PASSAGE OF HOUSE BILL 987 WAS A VALID EXERCISE OF
THE LEGISLATURE'S AUTHORITY.

DISCUSSION

¶10. A motion to dismiss under M.R.C.P. 12(b)(6) raises an issue of law. Tucker v. Hinds

County, 558 So.2d 869, 872 (Miss. 1990); Lester Eng'g Co. v. Richland Water & Sewer

7
Dist., 504 So.2d 1185, 1187 (Miss. 1987). This Court conducts de novo review on questions

of law. UHS-Qualicare, Inc. v. Gulf Coast Cmty. Hosp., Inc., 525 So. 2d 746, 754 (Miss.

1987). The scope of review of a motion to dismiss is that the allegations in the complaint

must be taken as true, and the motion should not be granted unless it appears beyond doubt

that the plaintiff will be unable to prove any set of facts in support of his claim. Brewer v.

Burdette, 768 So. 2d 920, 922 (Miss. 2000); Overstreet v. Merlos, 570 So.2d 1196, 1197

(Miss. 1990); Grantham v. Miss. Dep't of Corrections, 522 So.2d 219, 220 (Miss. 1988);

Lester Eng'g Co., 504 So.2d at 1187; Stanton & Assocs., Inc. v. Bryant Constr. Co., 464

So.2d 499, 505 (Miss. 1985). This Court employs the same standard on appeal in

determining whether a trial court's granting a motion to dismiss was error. McFadden v.

State, 542 So.2d 871, 874-75 (Miss. 1989). Though the totality of the record makes doubtful

the Municipalities claim of the trial judge’s “virtually verbatim adoption” of the MSTC’s

proposed findings of fact and conclusions of law, this claim is really of no moment inasmuch

as this Court has conducted a de novo review of the trial court’s actions and has

meticulously studied the entire record in this case in reaching today’s decision.

I. WHETHER THE TRIAL COURT ERRED IN HOLDING THE
MUNICIPALITIES DID NOT HAVE STANDING TO FILE
SUIT AGAINST THE MSTC.

¶11. The Municipalities argue that, as direct beneficiaries of the sales tax diversion statutes

and as the ones experiencing the adverse effects of the MSTC's actions, they have standing

to file this lawsuit.

8
¶12. The MSTC argues that the Municipalities do not have a right to sue the State unless

the right is specifically expressed by statute. The trial court agreed finding:

Since there is no statute or constitutional provision specifically granting the
Plaintiffs authority to bring this action, the Plaintiffs clearly lack standing to
bring this suit against the Mississippi State Tax Commission and the
Chairman of the Mississippi State Tax Commission. Due to Plaintiffs' lack of
standing to bring the present action, this action should be dismissed.

The MSTC also argues that the exclusive right to file a lawsuit of this nature is held by the

State Auditor. Miss. Code Ann. § 7-7-71 (Rev. 2002) states:

The state auditor, in the discharge of the official duties imposed upon him by
Sections 7-7-67 through 7-7-79, shall have full power and authority to
examine and investigate the books, records, papers, accounts, and vouchers
of any state, county, municipal, or other officer.

Section 7-7-67 states:

It shall be the duty of the state auditor to investigate the books,
accounts, and vouchers of all fiscal officers and depositories of the state and
of every county, levee board, and taxing district of every kind, and to sue for,
collect, and pay over all money improperly withheld by such fiscal officer or
depository. He has the power to sue and right of action against all such
officers and depositories and their sureties to collect any such moneys; but if
the delinquency appears by a correct open account on the books of the proper
accounting officer or depository, the right of the state auditor to sue shall
arise only after he has given thirty (30) days' notice to the delinquent officer
or depository to pay over the amounts and he fails to do so. If he shall
examine the books, accounts, and vouchers of any fiscal officer or depository
of the state, county, levee board, or taxing district of any kind and find them
correct, he shall give a certificate to that effect to such officer and to the board
of supervisors of the proper county, or to the proper levee board, or other
taxing district.
The state auditor may, in his discretion, also investigate the books,
accounts, and vouchers of any municipality, even though such investigation
and inspection has been made by a certified public accountant or an
accounting firm; and the state auditor shall have the same authority and
powers regarding such municipal inspections as granted herein regarding any
other investigation.

9
(emphasis added). The trial court again agreed with the MSTC and found that the State

Auditor had the exclusive authority to bring an action of this nature.

¶13. This Court's general rule on standing is as follows:

Parties may sue or intervene where they assert a colorable interest in the
subject matter of the litigation or experience an adverse effect from the
conduct of the defendant, see Dye v. State ex rel. Hale, 507 So.2d 332, 338
(Miss. 1987); Frazier v. State of Mississippi, 504 So.2d 675, 691-92 (Miss.
1987); Belhaven Improvement Association, Inc. v. City of Jackson, 507
So.2d 41, 45-47 (Miss. 1987), or as otherwise authorized by law, see, e.g.,
Canton Farm Equipment Co. v. Richardson, 501 So.2d 1098, 1105-09
(Miss. 1987); City of Pascagoula v. Scheffler, 487 So.2d 196, 198 (Miss.
1986).

Harrison County v. City of Gulfport, 557 So.2d 780, 782 (Miss. 1990). "Mississippi law

supports the proposition that no sovereign immunity exist[s] when the relief sought [i]s a

declaration that a particular statute or action of the State [i]s unconstitutional." State v.

Hinds County Bd. of Sup'rs, 635 So. 2d 839, 842 (Miss. 1994).

¶14. The Municipalities clearly have a colorable interest in the subject matter of this

litigation concerning statutorily prescribed sales tax diversions. The trial court was incorrect

in finding that there must be a specific constitutional provision granting the Municipalities

authority to bring this action. The trial court was also incorrect in finding the State Auditor

has exclusive authority to bring suits of this nature. The pertinent statutes do give the State

Auditor the power to bring these suits. However, the statutes, in no way, bestow exclusive

authority to the State Auditor alone.

10
¶15. Because the Municipalities have a colorable interest in the subject matter of this

litigation, we find the trial court erred in dismissing this suit on the grounds that the

Municipalities lacked standing.

II. WHETHER THE TRIAL COURT ERRED IN HOLDING THE
PASSAGE OF HOUSE BILL 987 WAS A VALID EXERCISE OF
THE LEGISLATURE'S CONSTITUTIONAL AUTHORITY.

¶16. The Municipalities next argue H.B. 987 violates the separation of powers doctrine

by instructing the judiciary on the interpretation of statutes.7 The Municipalities contend

H.B. 987 is an attempt to enact a measure declaring what the law was before the measure

was passed which they state is an improper exercise of legislative power and an improper

invasion of judicial power.

The rule is well settled that the judicial power cannot be taken away by
legislative action. Nor may the legislature regulate the judicial discretion or
judgment that is vested in the courts. Any legislation that hampers judicial
action or interferes with the discharge of judicial functions is
unconstitutional....The legislation has no power to direct the judiciary in the
interpretation of existing statutes.

16A Am. Jur. 2d Constitutional Law § 286, at 209-10 (1998) (footnotes omitted). The

Municipalities also state the abatement provision of Section 3 of H.B. 987 is an

7
Art. 1, § 1, Miss. Const., 1890, provides:

The powers of the government of the state of Mississippi shall be divided into three
distinct departments, and each of them confided to a separate magistracy, to-wit: those
which are legislative to one, those which are judicial to another, and those which are
executive to another.

Art. 1, § 2, Miss. Const., 1890, provides:

No person or collection of persons, being one or belonging to one of these
departments, shall exercise any power properly belonging to either of the others. The
acceptance of an office in either of said departments shall, of itself, and at once, vacate any
and all offices held by the person so accepting in either of the other departments.

11
encroachment upon judicial authority. The MSTC, on the other hand, argues that H.B. 987

is a law which passes constitutional muster and does not usurp the power of the judiciary.

¶17. Although we find the majority of the case law cited by the Municipalities predates

our Constitution, the crux of their argument is that the Constitution has granted the duty of

construing past laws to the courts. "[I]t is not for the legislature to construe laws for the past.

That duty is by the constitution devolved upon the courts. The legislature may determine

what the law shall be, but the courts must say what the law has been." McCulloch v. Stone,

64 Miss. 378, 395, 8 So. 236, 239 (1886). The Municipalities argue that this Court has held

numerous statutes unconstitutional in violation of the doctrine of separation of powers. See

Presley v. Miss. State Highway Comm'n, 608 So. 2d 1288 (Miss. 1992); Newell v. State,

308 So. 2d 71 (Miss. 1975); Loftin v. George County Bd. of Educ., 183 So. 2d 621 (Miss.

1966). The Municipalities also state that this Court has declared legislative attempts to

encroach upon the power of the executive branch to be unconstitutional. See Alexander v.

State ex rel. Allain, 441 So. 2d 1329 (Miss. 1983).

¶18. The Municipalities additionally argue that Miss. Code Ann. §§ 27-65-75 and 27-3-57

confer existing rights arising from prior transactions to the Municipalities. Those alleged

existing rights are at issue in the present litigation which was commenced prior to the

passage of H.B. 987. The Municipalities also contend Section 3 of H.B. 987, which declares,

"[a]ny suit brought by a municipality to recover additional payments under § 27-65-75,

Mississippi Code of 1972, in excess of the amounts authorized in this act is hereby

abated[,]" is another egregious attempt at legislative encroachment upon judicial authority.

12
The Municipalities cite several cases where this Court has held it unconstitutional for the

Legislature to pass a statute declaring an action abated. In Miller v. Hay, 143 Miss. 471, 109

So. 16 (1926) (Miller II), this Court held unconstitutional as a usurpation of judicial power,

a statute in which the Legislature declared a suit brought by the state revenue agent for the

use and benefit of Washington County against certain parties was abated. The Municipalities

find the following language from Miller II persuasive:

The separation of the legislative, executive, and judicial powers of the state
and their allotment to separate and distinct departments is so fundamental
under our system of government that it cannot be violated even by an
ordinance of a constitutional convention. A fortiori it cannot be violated by
one of the departments to which one of the powers has been committed.

The power vested in the Legislature by these sections of the Constitution, and
the only power which it can exercise, is the legislative power, so that the
question for decision is simply this, Is the power which the Legislature sought
to exercise by the enactment of the statute here in question legislative?
Whether or not a suit in equity or an action at law shall abate, that is, whether
all proceedings therein shall be suspended, unless and until the cause for the
suspension be removed, as well as whether a suit or action that has been
abated shall be revived, are judicial questions to be determined by the court
in which the suit or action is pending, and are so universally held to be such
that it would be supererogatory to cite authority therefor. The declaration in
this statute that the suit therein referred to "be and the same is hereby abated,"
and the permission therein given the board of supervisors to revive it, are an
attempt on the part of the Legislature to interfere in a pending judicial
controversy by the exercise of a power which the Constitution vests solely in
the courts, and are therefore void.

109 So. at 17. Through a legislative enactment, the Legislature was attempting to take away

the right of the revenue agent to bring a suit and place that right with the Board of

Supervisors. 109 So. at 17-18. The Constitution states the power to abate a suit and revive

13
it in the name of another lies solely in the judiciary. 109 So. at 18. See also Miss. Const. art.

6, § 144. Additionally, in Miller II, this Court held:

If it be conceded that the Legislature has the power to withdraw from the
revenue agent the right to prosecute a particular suit, in which connection
see Miller, Revenue Agent, v. Globe-Rutgers Fire Insurance Co. (Miss.) 108
So. 180, it has not the right to accomplish that object by exercising a power
which the Constitution vests solely in another department of the government,
and the means by which to further prosecute a particular suit is here sought to
be withdrawn from the revenue agent, under this construction of the statute,
to wit, the abatement of the suit and its revival in the name of another, are
committed by the Constitution to the judicial, and not to the legislative,
department of the government. Granted that an object sought to be
accomplished by one of the departments of the government is within the
power allotted to it, the means by which it seeks to accomplish that object
must also be within the power allotted to it. In other words, a constitutional
object must be accomplished by constitutional means.

109 So. at 17-18 (emphasis added).

¶19. Miller II was decided in June 1926 and was cited three months later in Miller v.

Johnston, 144 Miss. 201, 109 So. 715 (1926) (Miller III).8 This Court again held "the

Legislature was without power to abate pending suits filed by the former state revenue

agent." 109 So. at 720. In Miller III, the Legislature again was attempting to abate a suit

and revive it in the name of someone else. The Court found it was the duty of the state

revenue agent to investigate each pending suit which was filed by his predecessor. 109 So.

at 720. If the agent's investigation found the suit to be just, the agent was under a duty to

revive the predecessor's suit. 109 So. at 720. The statute passed by the Legislature sought

8
The Municipalities also cite Miller v. Davis, 109 So. 721 (Miss. 1926) (Miller IV); however, since
this case was a companion case to Miller III, and the two-paragraph Miller IV decision stated that the
Court’s decision was governed by the opinion rendered in Miller III, there is no need to refer further to
Miller IV.

14
to take away the power of the revenue agent to bring these suits and provide that power to

the attorney general. 109 So. at 719. The Court in Miller III followed the ruling in Miller

II and found this statute to be unconstitutional. 109 So. at 720. However, these facts do not

exist in the case sub judice. The Legislature is not attempting to take away the power of one

only to revive that power in an altogether different agent. The Legislature is instead abating

a suit brought by municipalities to recover additional payments under § 27-65-75 without

reviving the right to bring the same suit in another agent.9

¶20. We find it interesting that the Municipalities fail to cite a case which was decided

only fifty (50) days before Miller II. In Miller v. Globe-Rutgers Fire Ins., Co., 143 Miss.

489, 108 So. 180 (1926) (Miller I), this Court held a statute which abated pending suits

constitutional.

The validity of the second statute is challenged by the revenue agent on the
ground that it violates sections 1, 2, and 100 of the state Constitution.10 The
first two of these sections deal with the distribution of powers among the three
departments of state government, and the argument is that the effect of the
statute here under consideration is to abate pending suits, and therefore the
Legislature, by so providing, has usurped power which properly belongs to the
judicial department. Section 100 of the Constitution prohibits the Legislature
from remitting, releasing, postponing, or diminishing the obligation or liability

9
Even the Miller II Court in essence conceded that the Legislature had “the power to withdraw from
the revenue agent the right to prosecute a particular suit.” 109 So. at 17-18 (emphasis added).
10
Art. 1, §§ 1, 2, Miss. Const. 1890, are quoted in n. 7, supra. Art. 1, § 100, Miss. Const. 1890,
states:

No obligation or liability of any person, association, or corporation held or owned by this
state, or levee board, or any county, city, or town thereof, shall ever be remitted, released
or postponed, or in any way diminished by the legislature, nor shall such liability or
obligation be extinguished except by payment thereof into the proper treasury; nor shall such
liability or obligation be exchanged or transferred except upon payment of its face value;
but this shall not be construed to prevent the legislature from providing by general law for
the compromise of doubtful claims.

15
 of any person, association, or corporation held by the state and its political
subdivisions, and the argument is that this statute not only postpones, but in
effect releases the obligation of the appellees to pay the state the penalties
alleged to be due by them to the state for their alleged violation of the state's
Anti-Trust Laws.

While the effect of this statute is to abate pending suits brought by the revenue
agent under the anti-trust statutes, the abatement thereof results, not from any
attempt on the part of the Legislature to exercise judicial power, but because
of the exercise by the Legislature of its purely legislative power of designating
the duties to be discharged by a state officer. See section 103 of the state
Constitution.

***
The statute is valid, and, since it withdraws from the revenue agent power to
further prosecute this suit, the motion to dismiss the appeal must be sustained.

108 So. at 181 (emphasis added).

¶21. At first blush, it would appear that in Miller II and Miller III, when compared to the

decision in Miller I, are in conflict. However, a meticulous comparison of these three cases

reveals that these they are not in any way inconsistent. The first indication of this is that the

majority opinions in Miller I and Miller II, which were handed down only fifty (50) days

apart in 1926, are authored by the same justice (Chief Justice Smith). Additionally, there can

be no mistaking the fact that Chief Justice Smith and the Miller II Court were well aware

of their decision only 50 days earlier in Miller I because Miller II makes specific reference

to Miller I. What then is the difference between Miller I as compared to Miller II and Miller

III, to cause the Miller I Court to conclude that the legislature’s passage of a law which had

the effect of abating pending suits was not a legislative usurpation of the constitutional

authority granted to the judiciary, while the Miller II and Miller III Courts concluded that

the legislature’s passage of a law which had the effect of abating pending suits was a

16
legislative usurpation of the constitutional authority granted to the judiciary? The critical

difference is this. In Miller II and Miller III, the Legislature attempted to usurp its powers

vested by the Constitution by abating litigation brought by a revenue agent and reviving the

same litigation in the name of another. This power to abate a suit yet revive it in the name

of another lies solely in the judiciary. On the other hand, just like the case sub judice, Miller

I solely withdraws the power to prosecute a suit without reviving the suit in the name of

another.

¶22. Continuing with this comparison of the Miller decisions, in Miller II, the state

revenue agent, W. J. Miller, had initiated a suit in Washington County to recover certain

contractual debts. While the suit was pending, the Legislature enacted a statute which

provided:

Be it enacted by the Legislature of the state of Mississippi, that the suit
pending on the docket of the chancery court of Washington county (sic),
Mississippi, styled W. J. Miller, state revenue agent for the use and benefit of
Washington county (sic), Mississippi, against J. C. Hay and others, be and the
same is hereby abated; but such suit may be revived by the board of
supervisors of Washington county (sic), Mississippi, in which event all
contracts made by the state revenue agent in regard to such litigation shall be
complied with and carried out by the said board of supervisors.

1926 Miss. Laws, ch. 290, cited at 109 So. at 17. In specifically referring to its then 50-day

old decision in Miller I, the Miller II Court clearly distinguished Miller I by stating “[i]f it

be conceded that the Legislature has the power to withdraw from the revenue agent the right

to prosecute a particular suit,” the Legislature did not have the right to abate the lawsuit and

revive it “in the name of another.”

17
¶23. In Miller III, the plaintiff/appellee, Thomas H. Johnston (Johnston) was an attorney

for Stokes V. Robertson (Robertson), the predecessor of state revenue agent, W. J. Miller

(Miller), and Johnston had been employed by Robertson, in his capacity as then-revenue

agent, to file suits to collect outstanding privilege taxes and income taxes due the state.

Johnston’s lawsuit in Miller III was to collect attorneys fees based on an agreement between

Johnston and Robertson. During this litigation, the Legislature enacted a law which would

take from the revenue agent the right to bring these type suits and instead confer that right

upon the state Attorney General. In following its decision in Miller II, the Miller III Court

held the statute to be unconstitutional, but in so doing, the Miller III Court specifically

referred and distinguished its decision in Miller I:

In the case before [the court], the Legislature has not undertaken to
remove the power existing in the revenue agent to prosecute suits of the
character involved here, and it is clearly different from the case of Miller v.
Globe-Rutgers Fire Ins. Co. (Miss.), 108 So. 180; Johnston v. Reeves, 112
Miss. 227, 72 So. 925, in which cases the power of the revenue agent to bring
particular suits was taken from him by statute.

109 So. at 720.

¶24. In sum, Miller I is obviously still good law and was in no way overruled or

compromised by Miller II and Miller III, both of which specifically mention and distinguish

Miller I, which is factually consistent with the case before us today. In both Miller II and

Miller III, the Legislature passed laws which not only abated the pending litigation, but also

revived the suits in the name of another (one in the name of the Washington County board

of supervisors, and the other in the name of the state Attorney General). However, just as

18
in Miller I, today’s litigation was abated by legislative enactment which did not revive the

litigation in the name of another.

¶25. We simply do not agree with the Municipalities’ argument that H.B. 987 is an attempt

by the Legislature to usurp the powers of the judiciary. We do, however, agree with the

MSTC's argument that H.B. 987 is a valid, constitutional general law. Legislative actions

are presumed constitutional. Burrell v. Miss. State Tax Comm'n, 536 So. 2d 848, 858

(Miss. 1988); Miss. Power Co. v. Goudy, 459 So. 2d 257, 263 (Miss. 1984). The MSTC

correctly argues that under Mississippi case law, H.B. 987 should be given the full effect of

its clear purpose which is to exclude direct pay, interest and penalties and out-of-state or

"083" collections from the municipalities’ distributions. The MSTC states the Legislature

clearly intended to keep in effect the known exclusion of these special and unusual

categories of revenue by the MSTC from municipal distribution. Indeed, the MSTC has

employed this method for over thirty years.

¶26. The MSTC argues the Legislature clearly intended H.B. 987 to apply retroactively,

as well as prospectively, by the language in Section 1, "for all periods prior to the effective

date of this act." The MSTC cites several cases where this Court has upheld and affirmed

the retroactive application of legislation.

In a long line of cases, this Court has followed the rule that, in the
interpretation of statutes, they will be construed to have a prospective
operation only, unless a contrary intention is manifested by the clearest and
most positive expression. Hooker v. Hooker, 18 Miss. (Smedes & M) 599
(1848); Brown v. Wilcox, 22 Miss. (14 Smedes & M) 127 (1850); Richards
v. City Lumber Co., 101 Miss. 678, 57 So. 977 (1912); Power v. Calvert
Mortgage Co., 112 Miss. 319, 73 So. 51 (1916); State ex rel. Knox v. Union
Tank Car Co., 151 Miss. 797, 119 So. 310 (1928); Bell v. Union & Planters

19
 Bank & Trust Co., 158 Miss. 486, 130 So. 486 (1930); Mississippi Central
Railroad Co. v. City of Hattiesburg, 163 Miss. 311, 141 So. 897 (1932); City
of Lumberton v. Schrader, 176 Miss. 272, 168 So. 77 (1936); Jefferson
Standard Life v. Dorsey, 178 Miss. 852, 173 So. 669 (1937); United States
Fidelity & Guaranty Co. v. Maryland Casualty Co., 191 Miss. 103, 199 So.
278 (1941); McCullen v. State ex rel. Alexander, 217 Miss. 256, 63 So.2d
856 (1953); Klaas v. Continental Southern Lines, 225 Miss. 94, 82 So.2d
705 (1955); Horne v. State Building Commission, 233 Miss. 810, 103 So.2d
373 (1958).

This established rule of construction has been phrased in other ways by the
above cases: A statute will not be given retroactive effect unless it is manifest
from the language that the legislature intended it to so operate. It will not be
construed as retroactive unless the words admit of no other construction or
meaning, and there is a plain declaration in the act that it is. In short, these
cases illustrate a well-settled attitude of statutory interpretation: A preference
that it be prospective only, and a requirement that there should be a clearly
expressed intent in the act to make it retrospective.

Mladinich v. Kohn, 186 So.2d 481, 483 (Miss. 1966)(citations omitted). In Burrell v. Miss.

State Tax Comm'n, 536 So. 2d 848, 859-60 (Miss. 1988) and State ex rel. Pittman v.

Ladner, 512 So. 2d 1271, 1277 (Miss. 1987), this Court allowed the retroactive application

of statutes, amendments and rules.

¶27. In Burrell, taxpayers brought an action seeking to declare a statutory and

constitutional amendment null and void. The taxpayers argued House Bill 388 could not be

retroactively validated because laws only operate prospectively. 536 So. 2d at 859. This

Court disagreed with the taxpayers’ argument finding "legislative enactment of House Bill

No. 388 was so integrally related to the adoption of House Concurrent Resolution 41, so that

the latter, once ratified, ought be taken as breathing legal life into the former." 536 So.2d

at 860.

20
¶28. In Ladner, school board members who allegedly violated a statutory three

competitive bid rule then in effect were sued by the Attorney General and the State Auditor.

512 So. 2d at 1272-73. At the time the school board officials awarded the contract, the law

required at least three bids be received for all work done on rebuilding and repairing the

school. Id. On January 1, 1981, after the lawsuit was initiated, the Legislature repealed the

three bid requirement. Id. The school board members argued the law should apply

retroactively, despite the fact that the previously law prohibited their actions. Id. This Court

agreed and held the State had no enforceable rights under the now repealed rule. Id. In

Ladner, we quoted the Independent Linen rule,11 which states:

[T]he effect of a repealing statute is to abrogate the repealed statute as
completely as if it had never been passed, and that a statute modifying a
previous statute has the same effect as though the statute had all the while
previously existed in the same language as that contained in the modified
statute, unless the repealing or modifying statute contains a saving clause.

The result of this rule is that every right or remedy created solely by the
repealed or modified statute disappears or falls with the repealed or modified
statute, unless carried to final judgment before the repeal or modification,--
save that no such repeal or modification shall be permitted to impair the
obligation of a contract or to abrogate a vested right.

512 So.2d at 1275 (citations omitted).

¶29. The MSTC argues no right had vested in the municipalities prior to the enactment of

H.B. 987. In Ladner, this Court explained a vested right as a right that must be a "contract

right, a property right, or a right arising from a transaction in the nature of a contract which

11
Stone v. Independent Linen Serv. Co., 212 Miss. 580, 586-87, 55 So.2d 165, 168 (1951).

21
has become perfected to the degree that it is not dependent on the continued existence of the

statute." 512 So. 2d at 1275-76 (citation omitted).

What is necessary to enable the State of Mississippi to proceed under a
repealed statute is that the right the State seeks to assert be based upon some
contract, property or other vested right, that the right have being as a right
notwithstanding the statute's nonbeing.

The Independent Linen rule no doubt turns heads when it suggests the
nonexistence of that which we know existed in 1980, if for no other reason,
because we have before us the printed pages which were available in that year.
Of course, the three bid rule had existence. Prior to January 1, 1981, it was
susceptible of judicial enforcement. What the Independent Linen rule means
is this. The legislature of this state, as the principal exponent of the public
policy of this state, has declared that the three bid requirement will no longer
obtain in emergency public works circumstances. Because the statute has been
changed, and because this Court is obliged to act consistent with a rational
reading of the legislative declaration, we have as a matter of reason, precedent
and choice determined that we should stay our hand from enforcement of that
which has been repealed. Put more specifically, we accord a prior
consideration to the public policy pronouncement of the state qua legislature,
wholly interdicting the actions of the State qua its attorney general and its
auditor.

512 So.2d at 1276.

¶30. The MSTC disagrees with the Municipalities' reliance on Miller II and Miller III.

The MSTC contends those cases must be read in the context of Ladner and its progeny

which affirm the Legislature's power to enact retroactive, abating legislation. The MSTC

cites several cases where this Court has upheld and affirmed the retroactive application of

legislation, even when the legislation would abate litigation pending prior to the legislation

becoming adopted. See USPCI of Miss., Inc. v. State ex rel. McGowan, 688 So. 2d 783,

786-87 (Miss. 1997); City of Clarksdale v. Miss. Power & Light Co., 556 So. 2d 1056,

1057-58 (Miss. 1990).

22
¶31. In City of Clarksdale v. Miss. Power & Light Co., the city filed a petition to condemn

electrical facilities. Id. The trial judge dismissed the original suit because the amended

statute stated that "prior to a municipality exercising the power of eminent domain against

a utility the certificate of public convenience and necessity held by the utility had to be

cancelled by the [Public Service Commission]" Id. Because the PSC had not acted on the

utility's certificate of public convenience and necessity, the City's petition was dismissed. Id.

This Court affirmed finding a clear legislative intent for the amended statute to apply to

pending suits. Id.

¶32. In USPCI of Miss., Inc., a county resident filed a suit charging the governor did not

follow proper procedures in connection with the proposed construction of a hazardous waste

treatment facility. 688 So.2d at 785. While the suit was pending, the Legislature amended

Miss. Code Ann. § 23-43-5 to specifically exclude the governor from these requirements.

In USPCI, this Court held:

"When cases are in the bosom of this Court and there is involved a statute that
is modified prior to a final decision of this Court, we take that modification
into consideration." Bell v. Mitchell, 592 So.2d 528 (Miss. 1991)(citing
Parker v. Bailey, 437 So.2d 33 (Miss. 1983)).

This Court has also stated that an amendment to a statute should be treated as
though it had been a part of the original statute. City of Clarksdale v. Miss.
Power & Light Co., 556 So.2d 1056, 1057 (Miss. 1990).

As a result, the Governor's Office is not an agency within the meaning of the
APL.[12] Further, the Governor did not have to comply with the requirements

12
The Administrative Procedures Law, Miss. Code Ann. §§ 25-43-1 to -19 (Rev. 1999).

23
 of the APL in adopting his proposed CAP[13] because it is not a "rule" within
the meaning of the APL.

688 So 2d at 787.

¶33. The MSTC also argues that the Miller II and Miller III cases cited by the

Municipalities do not apply to the case sub judice because the legislation which attempted

to abate the state revenue agent's suits did not refer to the pre-existing statute authorizing the

lawsuit. H.B. 987 specifically refers to Miss. Code Ann. § 27-65-75 and states that its

application has been correct.

¶34. The Municipalities next argue that in an attempt to delegate legislative authority to

the MSTC, H.B. 987 violates the non-delegation doctrine. The Municipalities state because

H.B. 987 sets no rules or standards to guide the MSTC in their calculations regarding

diversions due municipalities, the bill is an attempt to give the MSTC, a state administrative

agency, unbridled authority in their calculations. Because of this arbitrary and uncontrolled

discretion, the Municipalities argue H.B. 987 is unconstitutional.

The traditional theory is that the legislature cannot delegate power to make
law, but may delegate power to determine facts on which the law makes its
own action depend. Clark v. State, 169 Miss. 369, 152 So. 820 (1934); Abbott
v. State, 106 Miss. 340, 63 So. 667 (1913). Legislative power or functions
may be delegated to an administrative agency only in the limited sense that the
statute must set forth the legislative decision and must prescribe adequate
standards or rules for the agency's guidance. It cannot be vested with an
arbitrary and uncontrolled discretion.

State v. Allstate Ins. Co., 231 Miss. 869, 882, 97 So. 2d 372, 375 (1957).

13
Capacity Assurance Plan.

24
¶35. The Municipalities argue H.B. 987 purports to give the MSTC broad discretion in

determining what is and is not covered by municipal diversion. The Municipalities state the

governing statutes declare each municipality is to receive a diversion of 18½ % of sales

taxes collected on all business activities, except for specified activities, conducted within the

municipality. The Municipalities argue that a statute which confers such absolute and

arbitrary discretion, without any guiding standard, should be declared unconstitutional by

this Court.

¶36. This Court disagrees with the reasoning of the Municipalities and finds the argument

of the MSTC more compelling. The MSTC asserts an administrative agency is afforded

deference by the judiciary in the "construction of its own rules and regulations and the

statutes under which it operates." McDerment v. Miss. Real Estate Comm'n, 748 So. 2d

114, 118 (Miss. 1999)(citing Miss. State Tax Comm'n, v. Mask, 667 So.2d 1313, 1314

(Miss. 1995)). Miss. Code Ann. § 27-65-9314 authorizes the Commissioner to promulgate

rules and regulations deemed necessary to enforce the provisions of the statute. The MSTC

argues discretion was granted and is expected by the legislation.

¶37. Finally, the Municipalities argue H.B. 987 constitutes an improper amendment to

Miss. Code Ann. § 27-65-75. The Municipalities contend Sections 1 and 2 of H.B. 987 seek

to amend the plain language of Miss. Code Ann. §§ 27-65-75 and 27-3-57 by ratifying,

14
Miss. Code Ann. § 27-65-93 (Rev. 2000), states in pertinent part:
The commissioner shall, from time to time, promulgate such rules and regulations, not
inconsistent with the provisions of the sales tax law, for making returns and for the
ascertainment, assessment and collection of the tax imposed by said law as he may deem
necessary to enforce its provisions; and, upon request, he shall furnish any taxpayer with a
copy of such rules and regulations.

25
approving and confirming the method previously employed by the MSTC to calculate sales

tax revenue to be diverted to municipalities and by stating this method is to be utilized in the

future. Because H.B. 987 does not insert the purported statutory modifications at length, the

Municipalities argue H.B. 987 is a violation of Art. 4, § 61, Miss. Const, 1890, which states

"[n]o law shall be revived or amended by reference to its title only, but the section or

sections, as amended or revived, shall be inserted at length."

¶38. The Municipalities assert because there is no definition of the method employed by

the MSTC to calculate the payments, no one can be certain what method has been employed

or if the MSTC is complying with the requirements of law. The Municipalities argue the

calculations made by the MSTC cannot be subjected to fair legislative scrutiny when they

are ratified by reference en masse. Additionally, the Municipalities argue that because H.B.

987 violates the Constitution, the bill cannot lawfully govern calculations made by the

MSTC after the effective date of the measure.

¶39. The MSTC asserts the Municipalities’ argument that the statute was "amended by

reference" fails because the Legislature, by its own language in H.B. 987, did not amend

Miss. Code Ann. § 27-65-75, but instead simply affirmed the statute and the administration

thereof. This Court has held a statute may be amended by implication. Lamar County Sch.

Bd. v. Saul, 359 So. 2d 350, 353 (Miss. 1978). "Section 61 of the Mississippi Constitution

of 1890 has no reference to amendment by implication when the amending statute is

complete within itself." Id. (citing Hart v. Backstrom, 148 Miss. 13, 113 So. 898 (1927)).

H.B. 987 is complete in itself. Municipalities will not be entitled to receive any additional

26
money from collections made prior to the passage of H.B. 987, and the method of

calculation will be the same as it has been since 1968. H.B. 987 also makes it clear that the

discretion afforded to the MSTC is limited to the previous method of calculation, and any

different calculation would be barred.

¶40. For those who might experience some consternation over whether today’s decision

somehow erodes the independence of the judicial branch of state government, it should be

remembered that municipalities are but creatures of the state and they possess only such

power as conferred upon them by statute. Miss. Code Ann. § 21-17-5(2) (Rev. 2000). This

includes the right of the Legislature to determine the amount of sales taxes which will be

diverted to the municipalities of this State. This concept should hardly be a shock to anyone.

Art. 4, § 88, Miss. Const., 1890 provides:

The legislature shall pass general laws, under which local and private interest
shall be provided for and protected, and under which cities and towns may be
chartered and their charters amended, and under which corporations may be
created, organized, and their acts of incorporation altered; and all such laws
shall be subject to repeal or amendment.

Miss. Code Ann. §§ 21-1-9 & 21-17-9 designate the various forms of government and

provide for charter amendments and the governing authority’s initiative, respectively.

¶41. Citing a long line of cases, this Court, in Peterson v. City of McComb City, 504

So.2d 208, 209 (Miss. 1987), reiterated the axiom that “[i]n Mississippi, a municipality is

a ‘creature’ of the State, possessing only such power as may be granted by statute.” See also

Adams v. Kuykendall, 83 Miss. 571, 35 So. 830 (1904). It necessarily follows that of the

three branches of state government, the legislative branch is the one possessing the

27
constitutional and statutory authority to not only divert sales taxes to the various

municipalities, but to also establish exemptions to the sales tax diversions. This was

obviously done in 1968, and such action had evidently remained unchallenged until the

present litigation. With matters involving the collection, expenditure and disbursement of

the taxpayers’ monies, we must afford great deference to that branch of state government

vested with clear constitutional and statutory responsibilities.

¶42. Since 1968, the Legislature has repeatedly convened and approved state budgets and

revenue bills. The MSTC argues, and we agree, that because the Legislature has not altered

a continuously standing sales tax regulation, the Legislature intended the same finding as

the MSTC's regulation. See Brady v. Getty Oil Co., 376 So. 2d 186, 191 (Miss. 1979). This

Court has held the following:

Under all constitutional governments recognizing three distinct and
independent magistracies, the control of the purse strings of government is a
legislative function. Indeed, it is the supreme legislative prerogative,
indispensable to the independence and integrity of the Legislature, and not to
be surrendered or abridged, save by the Constitution itself, without disturbing
the balance of the system and endangering the liberties of the people. The
right of the Legislature to control the public treasury, to determine the sources
from which the public revenues shall be derived and the objects upon which
they shall be expended, to dictate the time, the manner, and the means both of
their collection and disbursement, is firmly and inexpugnably established in
our political system.

Colbert v. State, 86 Miss. 769, 39 So. 65, 66 (1905).

¶43. The power of judicial review includes the power to declare acts of the Mississippi

Legislature to be unconstitutional. Estate of Smiley, 530 So.2d 18, 21 (Miss. 1988). See

Alexander v. State ex rel. Allain, 441 So.2d at 1347. "Legislative acts are, however, cloaked

28
with a presumption of constitutionality, and unconstitutionality must appear beyond

reasonable doubt." Estate of Smiley, 530 So. 2d at 21-22 (citing Mississippi Power Co. v.

Goudy, 459 So.2d at 263; Anderson v. Fred Wagner & Roy Anderson, Jr., Inc., 402 So.2d

320, 321 (Miss. 1981)). This Court has previously discussed the presumption of a statute's

validity, holding:

We adhere here to the rule that one who assails a legislative enactment must
overcome the strong presumption of validity and such assailant must prove his
conclusions affirmatively, and clearly establish it beyond a reasonable doubt.
All doubts must be resolved in favor of validity of a statute. If possible, a
court should construe statutes so as to render them constitutional rather than
unconstitutional if the statute under attack does not clearly and apparently
conflict with organic law after first resolving all doubts in favor of validity.

Loden v. Miss. Pub. Serv. Comm'n, 279 So.2d 636, 640 (Miss. 1973) (citations omitted).

This Court has also held:

We recognize that it is not for the courts to decide whether a law is needed
and advisable in the general government of the people. That is solely a matter
for the wisdom of the Legislature. But, it is our duty to construe the law and
apply it to the case presented, and determine whether the Constitution of this
State authorizes the legislation.

Moore v. Grillis, 205 Miss. 865, 888, 39 So.2d 505, 509 (1949).

¶44. After all, as already pointed out, Miss. Code Ann. § 27-3-57 provides that all funds

collected by the MSTC are public funds and shall be promptly deposited in the state treasury

and shall be disbursed by the State Treasurer according to law. Yet, the Municipalities,

through their pleadings, would have the trial court, and ultimately this Court, order the

MSTC to disburse to all the municipalities of this State a recalculated amount of sales tax

diversions which “should have been made over the past thirty (30) years.” As mentioned

29
early on in this opinion, this suit is not just one seeking declaratory and injunctive relief, it

also seeks sales tax money, and lots of it. As the MSTC correctly sets out in its brief, the

remedy for the Municipalities is available through the Legislature via the political process.

¶45. The purpose of a Rule 12(b)(6) motion to dismiss is to test the legal sufficiency of the

complaint. T.M. v. Noblitt, 650 So.2d 1340, 1345 (Miss. 1995). We find the Municipalities

will be unable to prove beyond a reasonable doubt any set of facts in support of their claim

as to the unconstitutionality of H.B. 987. Accordingly, we find H.B. 987 is a valid exercise

of the Legislature's constitutional authority. Pursuant to Sections 3 and 4 of H.B. 987, the

pending litigation must be abated.

¶46. Having addressed the issues concerning standing and the constitutionality of H.B.

987, we deem it unnecessary to address the remaining assignments of error as asserted by

the Municipalities.

CONCLUSION

¶47. This Court holds that the trial court erred in finding that the Municipalities lacked

standing to file this lawsuit. However, this Court finds that the trial judge did not err in

granting the MSTC's motion to dismiss as the Municipalities failed to state a claim upon

which relief could be granted. The legislative enactment of H.B. 987 was a valid exercise

of the Legislature's constitutional authority; and therefore, the pending suit must be abated.

In reaching this decision, we are ever mindful of our constitutional responsibility to

zealously guard against intrusion by one branch of state government into the affairs of

another branch of state government. Were we to be of the opinion today that the

30
Legislature’s passage of H.B. 987 amounted to a usurpation of the authority of the judicial

branch of state government, we would unhesitatingly so find. However, for the reasons

herein stated, we are firmly convinced that the judgment of the trial court must be affirmed.

¶48. AFFIRMED.

PITTMAN, C.J., SMITH, P.J., WALLER AND COBB, JJ., CONCUR.
GRAVES, J., CONCURS IN RESULT ONLY. DIAZ, J., DISSENTS WITH
SEPARATE WRITTEN OPINION TO FOLLOW. McRAE, P.J., DISSENTS WITH
SEPARATE WRITTEN OPINION JOINED BY DIAZ, J. EASLEY, J., NOT
PARTICIPATING.

McRAE, PRESIDING JUSTICE, DISSENTING:

¶49. The majority's finding that this action initiated by the municipalities was properly

dismissed by the Circuit Court of Hinds County is totally erroneous. I would find that H.B.

987 enacted six (6) months after this lawsuit was commenced should not be applied

retroactively. Furthermore, this Court should not selectively choose which statutes it will

apply retroactively.

¶50. In finding that this suit was properly dismissed due to the enactment of H.B. 987, the

majority relies on a line of cases which state that "in the interpretation of statutes, they will

be construed to have prospective operation only, unless a contrary intention is manifested

by the clearest and most prospective expression." (citations omitted). However, this

statement must be read in light of the whole statement by this Court. In Richards v. City

Lumber Co., 101 Miss. 678, 679, 57 So. 977, 978 (1912) this Court addressed whether the

enactment of Chapter 135 of the Laws of 1910 on April 16, 1910, which created the defense

of contributory negligence was to apply to a suit which was commenced on January 12,

31
1911, for an injury which occurred on March 30, 1910, some sixteen days before the

enactment of the statute. This Court's full statement regarding retroactive application of

statutes was as follows:

The rule is fundamental, in the construction of statutes, that they will be
construed to have a prospective operation, unless the contrary intention is
manifested by the clearest and most positive expression, and, further, that such
a construction should be placed upon the statute in order to preserve, if
possible, its constitutionality; that the Legislature has no power to take away
vested rights, in order to create a cause of action out of an existing transaction,
for which there was at the time of its occurrence no remedy; nor can it destroy
a valid defense to an action existing before the enactment of the statute. These
principles are fundamental, and require the citation of no authorities to support
them.

Id. This Court ultimately found that the contributory negligence statute was not to apply

retroactively. Id. Viewed in its full context this Court's holding suggests that rights and

defenses which are at issue in the judicial system should not be retroactively eliminated or

created by the Legislature. Just as this Court has found that the Mississippi Tort Claims Act

does not apply retroactively, Boston v. Hartford Acc. & Indem. Co., 822 So.2d 239, 245

(Miss. 2002), so too should this Court find that any statute eliminating or limiting a right

which has already been asserted is unconstitutional. Additionally, as illustrated in the

majority's rendition of numerous opinions where this Court has in one breath applied a

statute retroactively and just shortly thereafter in another opinion held a statute not to apply

retroactively, this Court should not selectively determine the retroactive effect of statutes.

¶51. Furthermore, the majority overlooks a provision of this State's Constitution, which

is directly on point. Article 4, §100 of the Mississippi Constitution of 1890 expressly limits

the authority of the Legislature:

32
 No obligation or liability of any person, association, or corporation held or
owned by this state, or levee board, or any county, city, or town thereof, shall
ever be remitted, released or postponed, or in any way diminished by the
legislature, nor shall such liability or obligation be extinguished except by
payment thereof into the proper treasury; nor shall such liability or obligation
be exchanged or transferred except upon payment of its face value; but this
shall not be construed to prevent the legislature from providing by general law
for the compromise of doubtful claims.

The law is clear that the State cannot skirt around its obligation to pay these municipalities

the tax revenue rightly owed to them. These small towns and cities are without a major

revenue source and desperately need these tax dollars to stay afloat financially. They are

unable by law to impose any other sales tax or tariff to satisfy their cash flow problems.

Their citizens are being disenfranchised because the monies owed to their municipalities and

them are being cut off by the Legislature's unconstitutional termination of this lawsuit. This

Court should not sit by and allow these municipalities to languish in debt, while the State

evades its legal obligations and duties. Therefore, I would reverse and remand for further

proceedings.

¶52. For these reasons, I dissent.

DIAZ, J., JOINS THIS OPINION.

33